The new pariah state

Hamas showed its strength in forcing Fatah from Gaza. But will it turn the desperate strip into a ne

Naser, a Palestinian cameraman, paid a visit to a family friend in Gaza last Sunday and found an eerily changed place. It was the first time he had set foot in the strip since Hamas declared its victory over Fatah in what was a humiliating military defeat for the Palestinian president, Mahmoud Abbas. More than a hundred of his forces were slain, or cold-bloodedly thrown from rooftops by Hamas fighters.

But that Sunday, Naser and his friends were overcome by a silence that had fallen on the battleground. No shots were heard that evening nor the evenings that followed. In previous months, the night air would have been pungent with gunfire as armed factions challenged one another, or family disputes erupted into violence. Monder, a lawyer from Al-Shati camp, also noted the altered mood. He observed how Gazans uncharacteristically respected traffic lights that were being manned by Hamas supporters rather than the little-respected traffic police of old. While Naser and Monder expressed relief at this new law-abiding behaviour by fellow citizens, they voiced concerns that Gaza was showing signs of a Taliban-style of government. This might have brought law and order to Afghanistan. It also plunged that country into the dark ages.

In an attempt to mollify the Egyptian government and lure it way from its historic alliance with Fatah, the Hamas leader, Khalid Mishal, told Egyptian authorities that his movement's tough stand against Fatah in Gaza had been necessary to prevent the strip from becoming a haven for al-Qaeda splinter groups. He was referring in part to the powerful clan of Dagmoush, which is responsible for holding captive the BBC correspondent Alan Johnston for the past three months. Mishal said Gaza's lawlessness had provided a fertile environment in which extreme groups could flourish. This message was important for Egyptian officials, who have had difficulty controlling their border with Gaza and preventing gangs from infiltrating on both sides via a network of underground tunnels. Over the past few years, Egyptian resorts along the Sinai coast have been targeted by suicide bombers, claiming hundreds of lives and seriously affecting the tourism industry on which Egypt depends. Security forces believe a number of Egyptian nationals from the desert border region were affiliated to al-Qaeda and had been hiding in the Gaza town of Rafah. Some reports have suggested they may also have received training and financial support from members of Hamas without the approval of its leadership.

Hamas's strongman in Gaza, Mahmoud al- Zahhar, the movement's former foreign minister, said the group was keen to co-operate with the Egyptian government, despite the strong links between Hamas, the Palestinian branch of the Islamic Brotherhood and its Egyptian mother branch - Egypt's President Hosni Mubarak's main opponent. This position was seen by some in the region as a PR campaign to improve Hamas's tarnished image following the brutal killings of its opponents and an attempt to woo western governments to talk to its deposed prime minister, Ismail Haniya. Still, by issuing threats against Johnston's captors, Hamas appears to be taking practical steps to distance itself from Islamic organisations and clans allied to al-Qaeda. It has not gone unnoticed that the kidnappers have said they would exchange Johnston for Abu Qutada, an al-Qaeda leader held in a British jail.

Search for friends

The Hamas decision to seize control of Gaza was born out of the realisation that this was the only available way of gaining the recognition, or at least attention, of the international community. Since its election victory in January 2006, it had been cold shouldered. The west's strategy did not change even after Hamas joined a unity government with Fatah three months ago.

Just as Taliban-ruled Afghanistan was recognised only by Pakistan and the United Arab Emirates, the Talibanisation of Gaza would leave it a pariah state with only Iran and Syria for friends. The consequences for Gaza's one million starving Palestinian population are alarming. At the moment nobody knows who will pay the salaries of more than 120,000 public-sector employees. Will Israel allow food and aid to get across checkpoints? What will happen to Palestinians crossing the border from Gaza to Egypt?

While Hamas's leaders do not appear to have answers to any of the questions, it seems that some of them, at least, are aware of the responsibilities they face. Al-Zahhar sent a message to the Israelis that said: "Hamas will not attack Israel before Israel attacks us." This raises another question: What will be Hamas's attitude towards other Palestinian factions such as Islamic Jihad or even Fatah's military wing, known as the al-Aqsa Martyrs Brigade, should they continue launching rocket attacks against neighbouring Israeli settlements? The only certainty would be the strength of Israel's response.

The timing of Hamas's military victory over Fatah suggests it must have co-ordinated with, or consulted, Tehran and Damascus. It is now clear that the sophistication of Hamas's arsenal easily dwarfed Fatah's resistance. However, that weaponry will count for little, surrounded as Gaza is by a hostile world.

Zaki Chehab is the author of "Inside Hamas", published by I B Tauris in the UK (£16.99) and by Nation Books in the US ($25.95)

Voices from Gaza

Atef Safi, 29: "Gaza's population has paid the price for the power struggle. Both factions are big-headed. We have ended up with a mini- Palestinian state for Hamas in Gaza without sovereignty and a large luxury state for Fatah without sovereignty in the West Bank. I hold the international community responsible for not dealing with the unity government that included ministers of both sides and for not lifting the embargo. Hamas was forced to take over the Gaza Strip as the world, including Fatah, did not give Hamas a chance."

Nasser Hammad, 40: "I'm so happy that Hamas has put an end to the security chaos. I now feel safe and I'm not worried any more about my children going alone to school. I drove my car today. I was excited to see policemen at every crossroad directing traffic. Police have also started to storm drug dealers' strongholds, which is good. Shame on Abbas's security forces. Even though he had 40,000 security men in Gaza, he was unable to end the lawlessness. Hamas had only 17,000."

Roa'a Salem, 22: "What is happening is the implementation of an Israeli-US conspiracy to make Palestinians forget about their real goal: to end 40 years of Israeli occupation and to establish a Palestinian state. Israel will support Abbas in the West Bank, easing life by removing some checkpoints and helping the economy improve there. At the same time, they will keep severe sanctions on Gaza, so that Gazans will rebel against Hamas. I think this won't happen. I predict that Israel will wage a full-scale invasion and shell the security compounds seized by Hamas."

Mahmoud, 30: "If you ask people here about their priorities, they will tell you, 'We want to feel safe and we want an end to anarchy.' We must get rid of the collaborators and mercenaries in the security forces led by Fatah, who participated in the siege imposed by the quartet to bring down the Palestinian government led by Hamas."

Compiled by Yousef Alhelou, Gaza City

This article first appeared in the 25 June 2007 issue of the New Statesman, Israel, Gaza and a summer of war?

Jeremy Corbyn. Photo: Getty
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Lexit: the EU is a neoliberal project, so let's do something different when we leave it

Brexit affords the British left a historic opportunity for a decisive break with EU market liberalism.

The Brexit vote to leave the European Union has many parents, but "Lexit" – the argument for exiting the EU from the left – remains an orphan. A third of Labour voters backed Leave, but they did so without any significant leadership from the Labour Party. Left-of-centre votes proved decisive in determining the outcome of a referendum that was otherwise framed, shaped, and presented almost exclusively by the right. A proper left discussion of the issues has been, if not entirely absent, then decidedly marginal – part of a more general malaise when it comes to developing left alternatives that has begun to be corrected only recently, under Jeremy Corbyn and John McDonnell.

Ceding Brexit to the right was very nearly the most serious strategic mistake by the British left since the ‘70s. Under successive leaders Labour became so incorporated into the ideology of Europeanism as to preclude any clear-eyed critical analysis of the actually existing EU as a regulatory and trade regime pursuing deep economic integration. The same political journey that carried Labour into its technocratic embrace of the EU also resulted in the abandonment of any form of distinctive economics separate from the orthodoxies of market liberalism.

It’s been astounding to witness so many left-wingers, in meltdown over Brexit, resort to parroting liberal economics. Thus we hear that factor mobility isn’t about labour arbitrage, that public services aren’t under pressure, that we must prioritise foreign direct investment and trade. It’s little wonder Labour became so detached from its base. Such claims do not match the lived experience of ordinary people in regions of the country devastated by deindustrialisation and disinvestment.

Nor should concerns about wage stagnation and bargaining power be met with finger-wagging accusations of racism, as if the manner in which capitalism pits workers against each other hasn’t long been understood. Instead, we should be offering real solutions – including a willingness to rethink capital mobility and trade. This places us in direct conflict with the constitutionalised neoliberalism of the EU.

Only the political savvy of the leadership has enabled Labour to recover from its disastrous positioning post-referendum. Incredibly, what seemed an unbeatable electoral bloc around Theresa May has been deftly prized apart in the course of an extraordinary General Election campaign. To consolidate the political project they have initiated, Corbyn and McDonnell must now follow through with a truly radical economic programme. The place to look for inspiration is precisely the range of instruments and policy options discouraged or outright forbidden by the EU.

A neoliberal project

The fact that right-wing arguments for Leave predominated during the referendum says far more about today’s left than it does about the European Union. There has been a great deal of myth-making concerning the latter –much of it funded, directly or indirectly, by the EU itself.

From its inception, the EU has been a top-down project driven by political and administrative elites, "a protected sphere", in the judgment of the late Peter Mair, "in which policy-making can evade the constraints imposed by representative democracy". To complain about the EU’s "democratic deficit" is to have misunderstood its purpose. The main thrust of European economic policy has been to extend and deepen the market through liberalisation, privatisation, and flexiblisation, subordinating employment and social protection to goals of low inflation, debt reduction, and increased competitiveness.

Prospects for Keynesian reflationary policies, or even for pan-European economic planning – never great – soon gave way to more Hayekian conceptions. Hayek’s original insight, in The Economic Conditions of Interstate Federalism, was that free movement of capital, goods, and labour – a "single market" – among a federation of nations would severely and necessarily restrict the economic policy space available to individual members. Pro-European socialists, whose aim had been to acquire new supranational options for the regulation of capital, found themselves surrendering the tools they already possessed at home. The national road to socialism, or even to social democracy, was closed.

The direction of travel has been singular and unrelenting. To take one example, workers’ rights – a supposed EU strength – are steadily being eroded, as can be seen in landmark judgments by the European Court of Justice (ECJ) in the Viking and Laval cases, among others. In both instances, workers attempting to strike in protest at plans to replace workers from one EU country with lower-wage workers from another, were told their right to strike could not infringe upon the "four freedoms" – free movement of capital, labour, goods, and services – established by the treaties.

More broadly, on trade, financial regulation, state aid, government purchasing, public service delivery, and more, any attempt to create a different kind of economy from inside the EU has largely been forestalled by competition policy or single market regulation.

A new political economy

Given that the UK will soon be escaping the EU, what opportunities might this afford? Three policy directions immediately stand out: public ownership, industrial strategy, and procurement. In each case, EU regulation previously stood in the way of promising left strategies. In each case, the political and economic returns from bold departures from neoliberal orthodoxy after Brexit could be substantial.

While not banned outright by EU law, public ownership is severely discouraged and disadvantaged by it. ECJ interpretation of Article 106 of the Treaty on the Functioning of the European Union (TFEU) has steadily eroded public ownership options. "The ECJ", argues law professor Danny Nicol, "appears to have constructed a one-way street in favour of private-sector provision: nationalised services are prima facie suspect and must be analysed for their necessity". Sure enough, the EU has been a significant driver of privatisation, functioning like a ratchet. It’s much easier for a member state to pursue the liberalisation of sectors than to secure their (re)nationalisation. Article 59 (TFEU) specifically allows the European Council and Parliament to liberalise services. Since the ‘80s, there have been single market programmes in energy, transport, postal services, telecommunications, education, and health.

Britain has long been an extreme outlier on privatisation, responsible for 40 per cent of the total assets privatised across the OECD between 1980 and 1996. Today, however, increasing inequality, poverty, environmental degradation and the general sense of an impoverished public sphere are leading to growing calls for renewed public ownership (albeit in new, more democratic forms). Soon to be free of EU constraints, it’s time to explore an expanded and fundamentally reimagined UK public sector.

Next, Britain’s industrial production has been virtually flat since the late 1990s, with a yawning trade deficit in industrial goods. Any serious industrial strategy to address the structural weaknesses of UK manufacturing will rely on "state aid" – the nurturing of a next generation of companies through grants, interest and tax relief, guarantees, government holdings, and the provision of goods and services on a preferential basis.

Article 107 TFEU allows for state aid only if it is compatible with the internal market and does not distort competition, laying out the specific circumstances in which it could be lawful. Whether or not state aid meets these criteria is at the sole discretion of the Commission – and courts in member states are obligated to enforce the commission’s decisions. The Commission has adopted an approach that considers, among other things, the existence of market failure, the effectiveness of other options, and the impact on the market and competition, thereby allowing state aid only in exceptional circumstances.

For many parts of the UK, the challenges of industrial decline remain starkly present – entire communities are thrown on the scrap heap, with all the associated capital and carbon costs and wasted lives. It’s high time the left returned to the possibilities inherent in a proactive industrial strategy. A true community-sustaining industrial strategy would consist of the deliberate direction of capital to sectors, localities, and regions, so as to balance out market trends and prevent communities from falling into decay, while also ensuring the investment in research and development necessary to maintain a highly productive economy. Policy, in this vision, would function to re-deploy infrastructure, production facilities, and workers left unemployed because of a shutdown or increased automation.

In some cases, this might mean assistance to workers or localities to buy up facilities and keep them running under worker or community ownership. In other cases it might involve re-training workers for new skills and re-fitting facilities. A regional approach might help launch new enterprises that would eventually be spun off as worker or local community-owned firms, supporting the development of strong and vibrant network economies, perhaps on the basis of a Green New Deal. All of this will be possible post-Brexit, under a Corbyn government.

Lastly, there is procurement. Under EU law, explicitly linking public procurement to local entities or social needs is difficult. The ECJ has ruled that, even if there is no specific legislation, procurement activity must "comply with the fundamental rules of the Treaty, in particular the principle of non-discrimination on grounds of nationality". This means that all procurement contracts must be open to all bidders across the EU, and public authorities must advertise contracts widely in other EU countries. In 2004, the European Parliament and Council issued two directives establishing the criteria governing such contracts: "lowest price only" and "most economically advantageous tender".

Unleashed from EU constraints, there are major opportunities for targeting large-scale public procurement to rebuild and transform communities, cities, and regions. The vision behind the celebrated Preston Model of community wealth building – inspired by the work of our own organisation, The Democracy Collaborative, in Cleveland, Ohio – leverages public procurement and the stabilising power of place-based anchor institutions (governments, hospitals, universities) to support rooted, participatory, democratic local economies built around multipliers. In this way, public funds can be made to do "double duty"; anchoring jobs and building community wealth, reversing long-term economic decline. This suggests the viability of a very different economic approach and potential for a winning political coalition, building support for a new socialist economics from the ground up.

With the prospect of a Corbyn government now tantalisingly close, it’s imperative that Labour reconciles its policy objectives in the Brexit negotiations with its plans for a radical economic transformation and redistribution of power and wealth. Only by pursuing strategies capable of re-establishing broad control over the national economy can Labour hope to manage the coming period of pain and dislocation following Brexit. Based on new institutions and approaches and the centrality of ownership and control, democracy, and participation, we should be busy assembling the tools and strategies that will allow departure from the EU to open up new political-economic horizons in Britain and bring about the profound transformation the country so desperately wants and needs.

Joe Guinan is executive director of the Next System Project at The Democracy Collaborative. Thomas M. Hanna is research director at The Democracy Collaborative.

This is an extract from a longer essay which appears in the inaugural edition of the IPPR Progressive Review.

 

 

This article first appeared in the 25 June 2007 issue of the New Statesman, Israel, Gaza and a summer of war?

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